There are many things to consider when you are deciding when to short sale your home. As a Massachusetts Real Estate Agent who has specialized in short sales over the past four years, the most important piece of advice I can give you is remove the emotion and work through the decision pragmatically. I know, easier said then done.
Once you see yourself in trouble work quickly through your options. Once you start missing mortgage payments its harder and harder to get caught up. The mortgage arrearages, interest and late fees add up fast.
The first thing to look at is what is your financial circumstances are they still up in the air and uncertain? or are they stabilizing and improving? There are options like a loan modification and bankruptcy that can help you save your home. Before you go these routes look at the situation practically and see if they are viable options or you will spend valuable time chasing an option that may not work.
If you are able to keep your home through one of the options the other thing to think about is do you want to keep paying on a home that your are 15% -30% (or even more) underwater on. I’ve seen howmowners who have paid $400,000 on a home who’s current value is $180,000 that will do anything to stay in it….. Do you really want to keep a home who value is so far below what is owed?
The thing to remember about [intlink id=”551″ type=”post”]loan modifications[/intlink] are you do need to qualify based on a percentage of income. If you are a year behind on your mortgage, don’t forget that they will modify it so they collect the arrearages. It is not all that unusual for me to see home owners modified mortgages to be more than their original mortgage leaving them in a worse situation than before.
Bankruptcy should only be considered if you can reduce your debt enough to make your mortgage financially affordable by reduction of other debt. Many times I see people go into bankruptcy and the bank files for a stay of relief and you are right back in the foreclosure process or the bankruptcy is discharged and your still not in the position to afford your home. Meanwhile you went through the expense and now you have a bankruptcy on your credit report.
The other two options to consider that will not allow you to stay in your home, but will prevent a foreclosure on your credit, are a deed in lieu of foreclosure or a short sale.
A deed in lieu of foreclosure is where basically you sign the deed over to the bank. Many banks still do not do these or they want you to try and do a short sale first. You can only do a deed in lieu if you have one lien on the property. Your probably better off trying to do a short sale first, in many cases in the deed in lieu they are retaining the right to go after a deficiency judgment. A short sale will most likely reduce the deficiency as it will sell for close to fair market value where a deed in lieu of foreclosure will be liquidated as an REO (similar to a foreclosed property). In a deed in lieu you don’t have to go through the hassle of maintaining and showing your home.
A Massachusetts short sale will allow you to sell your home for less money than what is owed and negotiate the terms of the short sale with the bank. We are still very successful in removing the right to go after a deficiency judgment or reducing the size of the deficiency.
At the end of the day it is important to remember that you have options to foreclosure. Any of the options will prevent the foreclosure mark from being on your credit as well as some of them will allow you to keep your home. It can be very emotional and personal and every homeowners circumstance are different.
If you are a Massachusetts homeowner that has missed mortgage payments, or facing foreclosure or a home buyer interested in buying a foreclosure or short sale call Kevin at 978-360-0422. I will explain your possible options to foreclosure. Every situation is different and you have about five options to consider. If a short sale is your best option my short sale team will work to complete a successful short sale on your home. Combined we have successfully closed 100’s of Massachusetts Short Sales. My closing ratio is almost 10
Other Short Sale Information:
- Free eBook- Should I Short Sale My Home
- [intlink id=”258″ type=”post”]The Strategic Short Sale[/intlink]
- [intlink id=”551″ type=”post”]Chasing the Loan Modification[/intlink]
- [intlink id=”365″ type=”post”]What is a Short Sale?[/intlink]
- [intlink id=”533″ type=”post”]The Short Sale and the Investor Offer[/intlink]
- [intlink id=”328″ type=”post”]Massachusetts Short Sale vs Foreclosure[/intlink]
Short Sale Realtor Services in northeast Massachusetts, the Merrimack Valley and surrounding area including the towns of Andover, Billerica, Boxford, Chelmsford, Dracut, Georgetown, Groveland, Haverhill, Lawrence, Lowell, Merrimac, North Andover, Newbury, Newburyport, North Reading, Rowley, Tewksbury, Tyngsboro, Westford, Wilmington, West Newbury.